Code Brain | The "Mitochondria" Employees in Startups

Mitochondria, the power plants inside cells

— Nature.com

Every employee at a startup sits somewhere on a spectrum between two extremes. On one end are people who treat the company as a job. They apply, join, and do their work. Some do it well. But it's still a job. They want to make sure they're fairly recognized and appreciated for their compensation and contributions, have a manager who cares about their growth, and are satisfied with their work. As long as they see all of this as balanced, they'll stay and be stable. In short, they're optimizing for themselves. They're rational actors. And the value they create for the company scales linearly with headcount — you can roughly assess how much impact adding more of these employees will bring.

The other end is completely different. These people operate more like founders. They're all-in because they believe in the company's vision, and that's how they work. They create value far beyond their job description. They think about what's best for the company and act on it. They work hard, willing to put in extra hours, because to them the company isn't just a job. Crucially, they most embody the company's values, so the value they bring doesn't scale linearly with headcount: they inspire and support the team through both hard times and good. These people are the "mitochondria" of startups.

In a loose capital market like 2021, when growth came easily, it was hard to tell these two types apart. When growth gets tough and every new hire is scrutinized more carefully, recruiting and retaining these "mitochondria" becomes essential.

In the early days, these few people are the core of the company. As the startup scales, they become its managers. Cherish employees with these traits, recruit them whenever possible, and encourage this mindset in others. Here are three things you can start doing.

01 Identify

Finding the "mitochondria" among your employees is the first step. Make a list. Build strong relationships with these people. Invest resources in them. Spot new "mitochondria" early, and understand what drives them.

02 Values-Based Interviewing

A company's values should be the blueprint for success at that company — the norms that guide team behavior and decisions. As mentioned earlier, "mitochondria" don't just excel at their jobs; they also fully embody a company's values. So to maximize your chances of recruiting them, you can't interview for competence alone. You need to interview for values.

Values-based interviews help you assess whether candidates align with your core values. These should be conducted by the founding team, and during scaling phases, by other "mitochondria" employees too (trust your "mitochondria"). To be clear: interviewing for values doesn't guarantee you'll hire mitochondria. But if you don't interview for values, and don't communicate their importance during the process, your hiring won't be best-in-class. Just like mitochondria in cells, if you don't actively replicate "mitochondria" employees, their share won't increase on its own.

03 Break the Hierarchy

At some point, companies establish formal compensation structures — setting pay for new and existing employees based on role and experience. The biggest mistake startups make is applying the same compensation structure to both types of employees. Compensation structures are rational, and they obscure factors that matter greatly but are hard to rationally assess: influence, dedication, and so on. If you don't break this hierarchical structure, the company will undervalue the inspirational impact that "mitochondria" bring, which ultimately undermines your ability to motivate and retain them.

This advice may raise concerns about creating inequality within the team. To be clear: this applies only to a very small number of employees, and their outsized impact should be self-evident.

If you want to encourage all employees to move toward becoming "mitochondria," one approach is to incorporate elements beyond job responsibilities — around values or impact — into performance reviews. At Pinterest, for example, there's a two-by-two matrix with "impact" on one axis and "values" on the other. At Mozilla, they assess employee impact beyond projects and the company itself. Either approach may work — what matters is emphasizing something larger than the individual, especially during the critical phase when a company grows from dozens to hundreds of people. As a startup matures into an established company, making any given value part of the culture only gets harder.

Original: The Mitochondria in Startups | Author: Sarah Tavel | Link: https://www.sarahtavel.com/p/the-mitochondria-in-startups